On Tuesday, the yen traded below 162 per dollar and approached its lowest level against the British pound since 2007, at 217.09. Despite some support last week due to speculation about a potential shift in Japan's intervention strategy, no action has been taken by authorities, leading to further declines.
Lee Hardman, a senior currency analyst at MUFG, noted that the absence of intervention during a U.S. holiday contributed to the yen's losses. Meanwhile, the broader market saw the dollar under pressure as expectations for U.S. rate hikes diminished following a disappointing jobs report.
Investors are now pricing in approximately 29 basis points of Federal Reserve rate hikes by December, down from 38 basis points a week prior. Carol Kong, a currency strategist at Commonwealth Bank of Australia, commented that current market pricing may be underestimating future rate hikes, although she anticipates the FOMC will begin tightening in December.
Attention is now on the upcoming minutes from the FOMC's June meeting for insights into the rate outlook